Stress-test failures increase banks’ M&A scrutiny, Fed research finds
US lenders’ merger-related activity improves if they have failed tests, authors say
Banks that fail the Federal Reserve’s stress tests engage in enhanced scrutiny of corporate mergers and acquisitions, a working paper finds.
When banks engage in that greater scrutiny, their loans for mergers and acquisitions (M&As) decrease in number and increase in quality. Credit quality improves, there are higher returns on assets, and stock prices rise in reaction, the researchers say.
The paper was published by the Federal Reserve System, and was written by Buhui Qiu and Teng Wang. Qiu is a
Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.
To access these options, along with all other subscription benefits, please contact info@centralbanking.com or view our subscription options here: http://subscriptions.centralbanking.com/subscribe
You are currently unable to print this content. Please contact info@centralbanking.com to find out more.
You are currently unable to copy this content. Please contact info@centralbanking.com to find out more.
Copyright Infopro Digital Limited. All rights reserved.
As outlined in our terms and conditions, https://www.infopro-digital.com/terms-and-conditions/subscriptions/ (point 2.4), printing is limited to a single copy.
If you would like to purchase additional rights please email info@centralbanking.com
Copyright Infopro Digital Limited. All rights reserved.
You may share this content using our article tools. As outlined in our terms and conditions, https://www.infopro-digital.com/terms-and-conditions/subscriptions/ (clause 2.4), an Authorised User may only make one copy of the materials for their own personal use. You must also comply with the restrictions in clause 2.5.
If you would like to purchase additional rights please email info@centralbanking.com
More on Financial market infrastructure
AI combines age-old issues with new opportunities, say panel
Governors from Rwanda, South Africa, and Sweden weigh in on how AI will change central banking
HKMA sets up company to run bond settlement system
Business will run the Central Moneymarkets Unit under new governance structure
New Zealand looks into expanding RTGS access to smaller firms
Central bank seeks to strike balance between opening access and mitigating risks from non-banks
MAS boosts support for training financial leaders
Singapore’s central bank to provide more funding to upskill promising finance professionals
Bank of Thailand launches data-sharing initiative
Central bank and regulators plan to make consent-based data-sharing mechanism operational in 2026
Bank Indonesia to launch central clearing house
Central bank says aim of CCP is to deepen country’s financial markets and mitigate systemic risks
Supervisors use generative AI to tame ‘chaotic’ data
Officials merge credit databases with unstructured reports to sharpen bank oversight, explains Banco de España ex-deputy
Hong Kong and Macao authorities link bond settlement systems
Direct connection could allow investors to trade wider variety of financial products